Tesla was early on in lowering its prices to stimulate demand. The strategy has been a bit of a double-edged sword, as it has caused second-hand values to move downwards while the profit margin is also at risk of taking a hit.
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Tesla for under half a million
Now Tesla is once again taking the lead in a wave of price cuts, lowering the Model 3 by SEK 23,000. This means that the version with rear-wheel drive costs under half a million kroner.
Next up is Toyota who are also announcing price cuts for their electric mid-size crossover bZ4X. Here it is claimed that it is about new components that cause the price to drop.
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Toyota lowers by over SEK 100,000
The price reduction that is now being made on the Toyota bZ4X is up to SEK 80,000. The front-wheel drive and cheapest version now costs from SEK 469,900 and the four-wheel drive from SEK 489,900. Since Toyota has already implemented a price reduction on its electric car, this means that the price has fallen by more than SEK 100,000.
China’s giant BYD is also following the price reduction trend and their cheapest model in Sweden, the Atto 3, will receive a reduction of up to SEK 58,000.
This means that the new price will be SEK 474,900, which is cheaper than competitors Kia and Hyundai, but still SEK 21,000 more expensive than the Chinese MG ZS EV.
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The electric car has proven to be a hard sell
These are price reductions that seem to be good for sales of the BYD Atto 3. Last year they sold over 3,000 cars, but this year only just over a hundred have rolled out of the car dealerships.
The price reductions send signals that times are tough in the electric car market and the competition is fierce, all manufacturers want a part of the electric pie which is growing at a faster rate than the market as a whole.
The question is whether the price cuts are enough to appease customers. The alternatives in the affected segments are many and despite the price reductions, the differences are not hysterically large.
The cheap electric car cost SEK 48,000 to insure